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DoD needs to set goals, measure progress for buying services

When it comes to buying services, the Defense Department needs to set goals and measure its progress — something it hasn't done over the years despite spending almost $200 billion a year.

A new Government Accountability Office report recommended DoD do more to improve its acquisition of services.

"Specifically, the [DoD Office of the Under Secretary of Defense for Acquisition, Technology and Logistics] has not yet fully addressed two key factors: a desired end state for the future with specific goals and associated metrics that would enable it to assess progress toward achieving those goals and determine whether service acquisition is improving," the report said.

The Office of the Under Secretary of Defense for Acquisition, Technology and Logistics is taking action to be more efficient with acquisitions, the report stated. Still, GAO said DoD does not know the extent to which these actions have resulted in improvements, as the agency has no metrics for determining success.

DoD is the largest buyer of contracted services, spending $186 billion in fiscal 2012, the report stated.

GAO cited the department's Better Buying Power Initiative as an example of how DoD is implementing Congress' requirements in its own way. The initiative identifies several areas where the under secretary is working to maximize productivity of defense spending, part of which is service acquisition spending.

"In its memorandum, [the under secretary] emphasized that DoD must prepare to continue supporting the warfighter through the acquisition of products and services in potentially fiscally constrained times. In its own words, [the under secretary] noted that DoD must 'do more without more,'" the report said.

GAO made two recommendations to improve DoD's service acquisition process.

The first is for DoD to define its end goals. The report stated DoD has trouble in this area because of limitations within its contracting and financial data systems. These challenges hinder DoD's ability to have broad insight into the state of its acquisitions.

DoD told GAO it planned to link the contracting and financial systems, and add extra information to improve its understanding of the services it buys.

Secondly, the report recommended DoD set departmentwide metrics to gauge progress in improving service acquisition. GAO said that prior reports show that metrics help identify critical processes and document results that senior officials can then use to make future decisions. Currently, DoD said it relies on reviews of individual service acquisitions to aid senior officials and evaluate progress.

The report stated that DoD has taken action to improve service acquisition, including strengthening management structure. DoD has also established various senior level management positions to address legislative requirements.

DoD also strengthened its review process for acquisitions and offered training to respond to these changes, the report said.

"Nevertheless, until DoD utilizes them to develop baseline data, goals, and associated metrics, similar to what it has committed to do for its strategic sourcing efforts, DoD will continue to be in a position where it does not know whether its actions are sufficient to achieve desired outcomes," the report said.